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Stop the presses: Qatar, which sits on two-thirds of the world's biggest conventional gas field in its own territorial waters, has applied with ExxonMobil (XOM) to the US Department of Energy for a license to export liquefied natural gas (LNG) from Port Arthur, Texas.

In a document received by the department August 17, Golden Pass Products (GPP), a Houston-based joint venture between state-owned Qatar Petroleum and ExxonMobil, seeks long-term, multi-contract authorization to export US-produced LNG to any country with the capability to import the fuel that has or will sign a free trade agreement with the US requiring "national treatment" for trade in natural gas. [Editor's note: ExxonMobile is the second biggest publicly traded producer of oil following PetroChina (PTR)].

"This application represents the first part of GPP's planned two-part request for authorization to export domestic natural gas in the form of LNG," the company said in its filing. "GPP will file a separate application with the Department of Energy, Office of Fossil Energy, to export domestically produced LNG to any country with which the US does not have a free trade agreement requiring national treatment for trade in natural gas, and which has or in the future develops the capacity to import LNG via ocean-going carrier, and with which trade is not prohibited by US law or policy," it added.

GPP also said it planned to apply to the US Federal Energy Regulatory Commission for authorization to build and operated gas liquefaction facilities on the site of the joint venture's existing LNG import terminal in order to liquefy and deliver domestically produced natural gas to ocean-going vessels.

The company said it was seeking a 25-year contract to export up to 740 Bcf (15.6 million mt) of natural gas annually, with the contract to commence on the earlier of the date of the first export or 10 years from issuance.

"GPP requests this export authority for itself so that it can engage in natural gas purchases and LNG sales for export, and act as agent for third parties. In addition, GPP seeks authorization to provide services as a tolling facility for third parties," it said.

Converting the US Gulf coast LNG import terminal to produce and export the fuel would cost about $10 billion, QP and ExxonMobil have estimated, making the application a serious vote of confidence in the robustness of the US shale gas revolution. The unexpected explosion in domestic US gas production is still gaining momentum, causing North American gas prices to collapse and drastically affecting Qatar's earlier plans to export LNG, the most expensive form of natural gas, to the US and eastern Canada.

Qatar, with 77 million mt of annual LNG production capacity, is the world's leading exporter of the fuel.

"GPP plans to export domestically produced natural gas delivered from the interstate pipeline grid and sourced from [the] very large and liquid US gas market," the joint venture said. "LNG exports will provide an outlet for domestic gas production, thereby promoting the continued development of US energy resources."

The company also said its proposed LNG production and export facilities would be integrated with the existing underutilized import terminal, allowing the facilities to adjust to changes in market conditions that might in future favor LNG imports.
"This flexibility comports with DOE policy favoring the trade of natural gas on a market-competitive basis," it argued.
In the gas world, the combined pockets of Qatar Petroleum and ExxonMobil are about as deep as they get. Moreover, the two have a history of partnering in LNG ventures. They jointly own and operate some of Qatar's biggest LNG plants.
Their joint application for a US gas export permit is the strongest indication yet that the US, after a decades long hiatus, is poised to resume its one-time role of supplying energy to the world beyond its borders.

This article by Tamsin Carlisle originally appeared on Platts'The Barrel.